Supreme Court Review, First Amendment & Campaign Finance Litigation

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Supreme Court Review, First Amendment & Campaign Finance Litigation 2 hours

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1 Supreme Court Review, First Amendment & Campaign Finance Litigation 2 hours Copyright 2017 by Comedian of Law LLC All rights reserved. Printed in the United States of America. Written permission must be secured from the publisher to use or reproduce any part of this book, or stored in a data base or retrieval system, except for brief quotations in critical reviews or articles and as permitted in the United States Copyright Act of Copies of the book can be ordered at

2 First Amendment Congress shall make no law respecting the establishment of religion or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances. U.S. Const. amend. I. History of Campaign Finance Regulations Early America and the President who never told a lie: Let s start back way at the beginning. George Washington. Now he did not belong to a political party. Not so coincidentally, there was also no funny business going on with George. But since then, we ve had political parties and we have had a lot of funny business. Now of course, back in that day, there was no social media. No Facebooking. Presidents didn t tweet. Ah those were the days! But there were newspapers. And newspapers informed the public. So you wanted to win the election? You needed the newspapers to like you. So at this time, the Federalists, led by Alexander Hamilton and John Adams, were able to curry the favor of more newspapers than the Democratic-Republicans, led by Thomas Jefferson and James Madison. In fact, it was a 4-1 ratio of newspapers supporting the Federalists over the Democratic-Republicans. So logically the Federalists won the next election! John Adams beat out Thomas Jefferson. And so the idea of buying influence was born in America. Political patronage. Under this system, contributors to a candidate were promised sinecures, or well paid do nothing jobs in the next administration. Do no-thing jobs in DC? What? Do you mean there are other jobs in DC other than do nothing jobs? Who knew? Andrew Jackson was famous for this. It was called the spoils system. And Andrew Jackson was famous for appointing those who contributed to his campaign to plum positions within his administration. The spoils system lead to the assassination of one of our beloved cartoon characters who moonlighted as President James Garfield. Apparently, he forgot how the spoils system worked and didn t promote Charles Guiteau to a post in his administration. Guiteau thought he was the reason Garfield won the presidency, and wanted the France gig. Upset that he was not packing his bags for Paris, he shot Garfield. Pendleton Civil Service Reform Act of The spoils system lead to the passage of the Pendleton Civil Service Reform Act of 1883, which required that civil service positions be filled based on merit and exam results, rather than party affiliation. This was a pivotal moment as it relates to our current problems. Political parties got their money from the spoils system. How it worked was those persons who received these plush jobs were expected to pay taxes to the parties that were responsible for them getting their jobs. You get a plush job, you pay your dues. But since those jobs were being cut back, the political parties had to go elsewhere to get their funding. So they turned to corporations and wealthy individuals. But a different kind of shake-down occurred as they threatened corporations with new regulations if they didn t pay their dues. 2 of 7

3 Things took a subtle, if not dramatic shift, during the 1896 election. Wealthy Ohioan Mark Hanna came up with a new campaign strategy. He asked corporations to get involved in politics. He asked corporations to give a quarter of one percent of their earnings to the republican party. The Republican party used that money to run a new campaign with posters, badges, and buttons bearing McKinley s image. It worked, and McKinley won. Money equals power. And more money equals more power! But there was public backlash to this. People didn t like the idea of the wealthy and corporations having an undue influence in politics. So naturally, there was some public backlash to this. Up next Big Teddy. The Trust buster. Teddy Roosevelt became president, and seized on this anti-corporate sentiment. And he proposed that all contributions by corporations should be forbidden by law. Tillman Act of The Tillman Act prohibited corporations and national banks from contributing money directly to presidential or congressional campaigns. Federal Corrupt Practices Act of This Act required House candidates to publically disclose campaign spending and contributions. Taft-Hartly Act of 1947 prohibited corporate expenditures as well as corporate contributions. Birth of the PAC. Because corporations couldn t spend its own treasury dollars on a candidate, they still wanted the influence. So a system was created whereby the employees would pool their money together, outside of the corporate treasury, and this pooled money would then be used to buy influence. Labor Unions created a segregated fund, separate from its general treasury, where members could give to the union for the purpose of making campaign contributions and expenditures. Publically Funded Elections and the Revenue Act of Another way to curb corruption was to create publically funded elections. This Act established a public campaign fund for eligible presidential candidates. Watergate. Created significant public mistrust of government. happened. The Federal Elections Campaign Act. Created the FEC to enforce compliance with campaign finance law. Set strict contribution limits. Limited the amount of money a candidate could give to his own campaign Placed total spending limits for presidential and congressional elections. Created a voluntary system of public financing for presidential elections. Buckley v. Valeo, 424 U.S. 1 (1976) Virtually every means of communicating ideas in today s mass society requires the expenditure of money. 3 of 7

4 The government pointed to a 1972 report that found that 2-3 percent of the wealthiest people in the country were responsible for 95 percent of the financing for congressional elections. In addition, the report found that many interest groups gave money to two or more opposing candidates running for the same office. Contribution limits on individuals were upheld. The Independent expenditure limits on individuals were struck down. The court left intact the prohibitions on corporate contributions and expenditures. Issue advocacy was permitted. A corporation could not make political contributions or expenditures, but it could advocate for issues. So what is the difference between issues and supporting a candidate? The prohibitions only pertained to expenditures for communications that in express terms advocate the election or defeat of a clearly identified candidate for federal office. This gave rise to magic words. As long as the communication avoided the magic words, it was likely ok. Magic words included: vote for elect support cast your ballot for defeat or reject. The court also struck down the limitation on how much candidates could spend on their own campaigns. In addition, the court struck down ceilings on overall campaign expenditures. The Court upheld the disclosure requirements. Bipartisan Campaign Reform Act, aka BCRA, aka McCain-Feingold. McCain Feingold was really designed to confront two problems that had been identified since FECA was passed: soft money and issue ads. In 1984, soft money only accounted for 5%, or 21.6 million of the total spending of the two major political parties. By 2000, soft money accounted for 42%, or 498 million of the two major parties total spending. In addition, the vast majority of this soft money was given by large donors. For instance, in 2000, 60% of the soft money originated from only 800 donors. And again, the largest of these corporate donors were giving to both parties. McCain Feingold prohibited political parties from raising or spending any money not subject to the federal limits. This ended soft money at the party level. Recent Supreme Court Cases on Campaign Finance Activity Citizens United v. FEC, 558 U.S. 310 (2010) Facts: A political advocacy group wanted to produce and promote a movie called Hillary during the 2008 Presidential election, but refrained from doing so because BCRA prohibited corporations from making independent political expenditures during federal elections. In addition, BCRA required those who made the independent expenditure to disclose the speaker. Issue: Can Congress prohibit corporations from making independent political expenditures during a federal election? Holding: No. Rationale/interesting quotes: 4 of 7

5 The Supreme Court overruled Austin v. Michigan Chamber of Commerce and portions of McConnell v. FEC by holding that political speech may not be banned based on the speaker's corporate identity. By a 5-to-4 vote, the majority held that corporate funding of independent political broadcasts in candidate elections cannot be limited. The majority maintained that political speech is indispensable to a democracy, which is no less true because the speech comes from a corporation. The majority also held that the BCRA's disclosure requirements as applied were constitutional, reasoning that disclosure is justified by a "governmental interest" in providing the "electorate with information" about election-related spending resources. The Court upheld the disclosure requirements for political advertising sponsors and it upheld the ban on direct contributions to candidates from corporations and unions. McCutcheon v. FEC, 134 S. Ct (2014) Facts: BCRA imposed separate limits on the amounts that individuals may contribute to federal candidates and other political committees. Adjusted for inflation, individual could contribute up to $2,500 per election to federal candidates, up to $30,800 per calendar year to a national party committee and up to $5,000 per calendar year to any non-party political committee. BCRA also imposed an overall limit on the aggregate amount individuals could contribute in a two-year period. After adjusted for inflation, an individual could contribute no more than a total of $46,200 to all federal candidates, and no more than $70,800 to federal political action committees and political party committees. Alabama resident Shaun McCutcheon wanted to contribute more than the current biennial limit permits, and the RNC would like to receive contributions from individuals like Mr. McCutcheon that exceeded the aggregate limits. McCutcheon challenged both the $46,200 aggregate limit on candidate contributions and the $70,800 aggregate limit on other contributions as violating the First Amendment. Issue: Can Congress limit the aggregate amount that an individual can contribute in an election cycle to all candidates? Holding: No. Rationale/interesting quotes: The right to participate in democracy through political contributions is protected by the First Amendment, but that right is not absolute. Our cases have held that Congress may regulate campaign contributions to protect against corruption or the appearance of corruption. See, e.g., Buckley v. Valeo, 424 U.S. 1, (1976) (per curiam). Congress may target only a specific type of corruption quid pro quo corruption... Spending large sums of money in connection with elections, but not in connection with an effort to control the exercise of an officeholder s official duties, does not give rise to quid pro quo corruption. Nor does the possibility that an individual who spends large sums may garner influence over or access to elected officials or political parties. 5 of 7

6 The Court concluded that the aggregate limits on contributions do not further the only governmental interest this Court accepted as legitimate in Buckley. They instead intrude without justification on a citizen s ability to exercise the most fundamental First Amendment activities. While the Court s decision removed the overall cap on individual contributions, it did not affect the Act s base limits on individual contributions to federal candidate campaigns, PACs or party committees. Ariz. Free Enter. Club's Freedom Club PAC v. Bennett, 564 U.S. 721 (2011) Facts: Arizona enacted a campaign finance law that provides matching funds to candidates who accept public financing. The law gave an initial sum to candidates for state office who accepted public financing and then provided additional matching funds based on the amounts spent by privately financed opponents and by independent groups. In 2008, some Republican candidates and a political action committee, the Arizona Free Enterprise Club, filed suit arguing that to avoid triggering matching funds for their opponents, they had to limit their spending and thus their speech. Issue: Does the First Amendment prohibit linking the publically financed funds with the giving/ spending of opponents? Holding: Yes Rationale/interesting quotes: Arizona's matching funds scheme substantially burdens political speech and is not sufficiently justified by a compelling interest to survive First Amendment scrutiny. Justice Elena Kagan dissented, joined by Justices Ruth Bader, Stephen Breyer and Sonia Sotomayor. "The First Amendment's core purpose is to foster a healthy, vibrant political system full of robust discussion and debate. Nothing in Arizona's anticorruption statute, the Arizona Citizens Clean Elections Act, violates this constitutional protection. To the contrary, the Act promotes the values underlying both the First Amendment and our entire Constitution by enhancing the 'opportunity for free political discussion to the end that government may be responsive to the will of the people.'" Susan B. Anthony List v. Driehaus, 134 S. Ct (2014) Facts: Prior to the 2010 general election, Susan B. Anthony List announced that it intended to put up a billboard in the district of then-congressman Steven Driehaus. The billboard would have asserted that Driehaus's voted in favor of taxpayer-funded abortion. Citing threats of legal action by Driehaus's counsel, the company that owned the billboard space refused to put up the ad. Driehaus filed a complaint with the Ohio Elections Commission alleging that SBA List violated Ohio's campaign laws by making false statements about his voting record. SBA List filed an action in federal district court arguing that the Ohio statutes infringed upon its rights to free speech and association under the First Amendment. Driehaus withdrew his complaint upon losing his bid for re-election and subsequently moved to Swaziland for an assignment with the Peace Corps. 6 of 7

7 Issue: Does Susan B. Anthony List have standing to bring this pre-enforcement challenge? Holding: Yes Rationale/Interesting quotes A preenforcement challenge to an Ohio statute that prohibits certain false statements during a political campaign is justiciable, and the challengers have alleged a sufficiently imminent injury for purposes of Article III, when they have pleaded specific statements that they intend to make in future election cycles that are arguably proscribed by the Ohio law and there is a history of past enforcement of the law insofar as one challenger was the subject of a complaint in a recent election cycle. Pre-enforcement challenges are justiciable when circumstances indicate that threatened enforcement of the statute is sufficiently imminent. The petitioners' political speech focused on the issue of support for the Affordable Care Act, not simply on Driehaus, and thus was likely to continue despite Driehaus' departure. The Court determined that there was a threat of future enforcement even though petitioners maintained their statements were true. Because the respondents did not disavow enforcement if petitioners carried out their speech in the future, the Court held that the prospect of enforcement was not "imaginary or speculative" and that petitioners had shown sufficient injury for pre-enforcement review. 7 of 7

SHIFTS IN SUPREME COURT OPINION ABOUT MONEY IN POLITICS

SHIFTS IN SUPREME COURT OPINION ABOUT MONEY IN POLITICS Before 1970, campaign finance regulation was weak and ineffective, and the Supreme Court infrequently heard cases on it. The Federal Corrupt Practices